BUY GONE ERA

Mil­lion-dol­lar auc­tions show in­vestors are join­ing trag­ics in pur­suit of clas­sic cars

Mercury (Hobart) - Motoring - - MOTORING - CRAIG DUFF

Our appreciation of rare chrome­bumpered cars is fu­elling record auc­tion prices that out­per­form in­vest­ments in art, coins and fine wine. The sen­ti­ment is high­lighted by the re­cent sale of a pair of Ford Fal­con GTHO Phase IIIs for more than $1 mil­lion.

That price is tipped to dou­ble when Peter Brock’s VK Group A Com­modore goes un­der the ham­mer in Oc­to­ber. And at an auc­tion in the US later this month, a Fer­rari 250 GTO is ex­pected to fetch more than $80 mil­lion.

The Frank Knight Wealth Re­port, which tracks global in­vest­ments, re­in­forces the de­sir­abil­ity of clas­sic cars. In the past 10 years prices have climbed by an as­ton­ish­ing 334 per cent, a re­turn on in­vest­ment that out­strips ev­ery other bench­mark.

De­mand for fine wines has been el­e­vated by the rise of wealthy Asian con­nois­seurs but prices have in­creased by 192 per cent in the past decade. Cashed-up col­lec­tors have pushed the value of rare coins and notes up by 182 per cent over the same pe­riod.

The de­mand for clas­sic cars shows lit­tle signs of slow­ing, at least in the ab­sence of a global fi­nan­cial mar­ket melt­down.

The re­port quotes Di­et­rich Hat­lapa of an­a­lyst HAGI, which pro­vides car data to Frank Knight, as say­ing there is no in­di­ca­tion prices will come off the boil.

“It’s hard to make pre­dic­tions but what I can be fairly con­fi­dent about is that strong prices will be paid for the best cars by knowl­edge­able col­lec­tors this year,” Hat­lapa says.

The Fer­rari 250 is worth out­ra­geous money but savvy lo­cal in­vestors can make a killing if they pick the right car. Here are the key seg­ments in the clas­sic car in­ven­tory.

AUSSIE CARS

Lloyds Auc­tions’ chief auc­tion­eer Bill Free­man — who over­saw the sales of the Phase IIIs and will con­duct the Brock Com­modore auc­tion — says nos­tal­gia is driv­ing lo­cal de­mand.

“What we’re see­ing is peo­ple buy­ing cars be­cause of their emo­tional at­tach­ment to them,” Free­man says.

“Every­one re­mem­bers their first car, their par­ents’ first car and the cars they had as posters on the wall. When my dad bought his first car every­one in the street came out and he

took peo­ple around the block. Jump into one of those cars to­day and they still smell the same — we get trans­ported back to that time.”

If it was made in Aus­tralia and has a chrome bumper, there’s go­ing to be up­side. How much will de­pend on the car’s con­di­tion and his­tory. Peo­ple who didn’t in­vest in a Phase III can still make se­ri­ous money.

“We sold an HR Holden Premier the other day and we got $42,000 for it. The seller said to me, ‘My mates were call­ing me an id­iot be­cause I paid the high­est price in Aus­tralia’. He bought it eight years ago and paid $14,000.

“To­rana XU-1s were selling for $55K-$60K 18 months ago. We’ve gone back to those buy­ers and said, ‘We can get you $200K’ and they’re say­ing they’re not for sale.

“HT Kingswoods are go­ing for $48K in mint con­di­tion. If I buy a new car for $48K, what it’s worth in the next few years?”

EURO­PEAN

In­ter­est in Euro ve­hi­cles is based on a cou­ple of fac­tors — those ve­hi­cles haven’t been dam­aged by salt on the roads dur­ing win­ter (as is in the case in Europe and the US) and Aussiede­liv­ered cars tend to be well main­tained.

Christophe Bori­bon of Shan­nons Auc­tions says the mar­ket is strong, driven by Euro­pean in­vestors real­is­ing our ve­hi­cles tend to be in bet­ter nick.

“The over­seas mar­ket has been very strong in the past few years,” he says. “We’ve seen them come up pretty quickly. Some­thing like a 1973 Porsche RS Car­rera or Day­tona Fer­rari is now worth $1 mil­lion and a (Mercedes-Benz) 280SL is fetch­ing $200K-250K.”

If you’re look­ing at some­thing that will be a fu­ture col­lectable, Bori­bon has some rec­om­men­da­tions, among them a 1988-90 BMW E30 325iS man­ual coupe or an 1994-98 E36 M3 with a man­ual trans­mis­sion. Look also at the Porsche Boxster S 3.2 con­vert­ible that went on sale in 2000 and a 1988-94 Peu­geot 205GTi coupe.

AMER­I­CAN

If it was born in the USA and built be­fore the 1980s — broadly, a Mus­tang, Ca­maro, Corvette or Dodge — prices are only go­ing up.

Harry Chris­tian of mus­cle­carsales.com.au set up Aus­tralia’s first on­line car sales site in 2003 and says in­ter­est has never been higher, though he cau­tions some cars have value only to cer­tain gen­er­a­tions.

“I don’t know if the younger peo­ple have much in­ter­est, which lim­its the fu­ture growth of some cars,” he says. “Oth­ers — gen­uine clas­sics like limited edi­tion Fer­raris and Porsches and the GTHOs — tran­scend the gen­er­a­tional is­sue be­cause of their rar­ity and his­tory.

“A Ford XB coupe is go­ing to cost you north of $90,000-$100,000. As­tute buy­ers can buy a Boss Mus­tang for that money. I’ve seen 302 ’Stangs dou­bling in value over the past 12 months to $120,000. Mopar (Chrysler) and col­lectable Corvettes are also go­ing hard.”

Bori­bon says fin-tailed boule­vard cruis­ers — think 1950s and 1960s Cadil­lacs (main pic­ture, 1958 Fleet­wood) — are also a worth­while in­vest­ment, pro­vid­ing you can fit them in the garage. “Some are six me­tres long, which lim­its the mar­ket purely be­cause many po­ten­tial buy­ers can’t fit them in their garage. If you have the space, they’re worth a look be­cause they were the ul­ti­mate car of that era and com­peted with Mercedes and Bent­ley as pres­tige drives.”

JA­PANESE

Choose care­fully here. Hav­ing a spe­cial ve­hi­cle with a full his­tory is the key to re­turns. Ve­hi­cles such as the Dat­sun 180B SSS coupe, early Nis­san Sky­lines and Mazda S800s are in de­mand in Aus­tralia and over­seas but Chris­tian says the Ja­panese mar­ket is yet to take off.

“It’s still rel­a­tively niche but we’re see­ing in­creas­ing in­ter­est in those cars. They aren’t as tra­di­tion­ally valu­able as the US and Euro stuff — and be­cause of that there’s a lot of po­ten­tial growth in that seg­ment,” he says.

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